reverse directors loan

[babybel]

cheers.

I'm waiting for my accountant to get back but they are being so slow these days I've finally got my arse in gear to switch.

I'll post back when I have anything more.

Thank you both!

[northernladuk]

OP would definitely be best speaking to his accountant to get the ins and outs of this. To specifically cover your insurance point, provided the policy was in the company name and paid from the company account it would be fully allowable as it is in relation to the provision of the company van (assuming this is owned by the company). The insurance is allowed to cover named drivers but this gives rise to a VAN BIK on the employee/director, the policy is still 'wholly and exclusively' for business use.

Martin
Contratax Ltd

That's interesting and certainly goes against the wholly and exclusively mantra no? Assuming the insurance is more expensive the company would be incurring costs for personal use and the wife would be getting free insurance for no business reason. The whole duality/wholly and exclusively is ignored in this situation?

[ContrataxLtd]

That's interesting and certainly goes against the wholly and exclusively mantra no? Assuming the insurance is more expensive the company would be incurring costs for personal use and the wife would be getting free insurance for no business reason. The whole duality/wholly and exclusively is ignored in this situation?

The duality of purpose/wholly & exclusively argument is in a way ignored when a BIK comes in to play because when something is being taxed as a BIK it is deemed to be wholly and exclusively for business use as part of the remuneration package of the employee/director.

The wife is receiving the insurance by means of her husbands employment/directorship so it is him who is taxed on the BIK (assuming wife isn't involved in the company).

Also, at the end of the day all the insurance is doing is protecting a company asset and is therefore wholly and exclusively for business purposes.

Same argument goes for company cars, they aren't used 100% for business but they are still an allowable cost because there is a BIK in the charge to tax.

Martin
Contratax Ltd

[northernladuk]

Interesting. Thanks

[northernladuk]

You can make an interest free loan for a certain amount. I guess it should be a maximum of £10,000 if it is not changed recently.

Being an accountant that purportedly specialises in one man setups should you not know this????

You guess??!?

[ContrataxLtd]

You can make an interest free loan for a certain amount. I guess it should be a maximum of £10,000 if it is not changed recently.

The OP is/would be loaning the money to his company, not borrowing it from the company, therefore, he could lend as much as he wants if he so wishes.

The £10,000 limit is only applicable for loans to a director/shareholder from the company.

Martin
Contratax Ltd